Bullish option flow detected in Tempur Sealy with 3,358 calls trading, 1.4x expected, and implied vol increasing over 1 point to 49.51%. Jan-19 50 calls and Jan-20 45 puts are the most active options, with total volume in those strikes near 2,600 contracts. The Put/Call Ratio is 0.31. Earnings are expected on February 21st.

Loop Capital affirms Sell rating on Tempur Sealy after Q3 miss. Loop Capital analyst Laura Champine maintains a Sell rating Tempur Sealy with a $36 price target after the company's Q3 results missed expectations on the top- and bottom-lines. The analyst is concerned that Tempur's price increases in 2019 to recapture higher commodity costs "may only encourage continued consumer trade-down in the company's range." It may be tough to convince consumers to trade up to higher-priced offerings in the Sealy line in particular given the aggressive financing offers customers rely on in the mattress industry and the influx of competing mattresses from Asia at compelling price points, Champine tells investors in a post-earnings research note.

Cites retailer credit issues, the under-performance of International operations, primarily in Europe, and incremental commodity headwinds primarily related to tariffs which are not yet offset by the pricing actions announced for January 2019.

Stifel bullish on Tempur Sealy ahead of earnings given high-end brand strength. Stifel analyst John Baugh said his holiday channel checks, discussions with trade contacts and an increased level of review activity for the Tempur-Pedic brand add up to give him increasing conviction going into Tempur Sealy's Q3 earnings report that its domestic TempurPedic sales are strong. Though he is not changing his estimates in front of the Q3 release, Baugh believes the Tempur brand is performing better than he'd thought several months ago while Sealy is now likely struggling more. He keeps a Buy rating and $60 price target on Tempur Sealy shares.

In connection with the announcement that Sears Holdings (SHLD) and certain of its subsidiaries have filed for bankruptcy protection, Tempur Sealy (TPX) is disclosing its credit exposure and sales volume related to Sears. Sears represented less than 5% of the company's global net sales and less than $5M of its accounts receivable exposure as of September 30, 2018. Tempur Sealy Chairman and CEO Scott Thompson commented, "Our products are broadly distributed across many channels so consumers can choose where and how they wish to shop. We continue to work closely with Sears during their restructuring process while managing our related financial and operational risks."

The alleged dumping of China-made mattresses is being investigated by the U.S. following complaints from several U.S. manufacturers, including Leggett & Platt (LEG), Tempur Sealy (TPX) and others, Reuters reports. Reference Link

Mattress Firm announced that it has received interim approval from the U.S. Bankruptcy Court in Delaware for all of its "First Day" motions related to the voluntary prepackaged Chapter 11 restructuring cases it initiated on October 5, 2018. Collectively, the interim approvals will help ensure that Mattress Firm continues normal business operations throughout the financial restructuring process. The company expects to complete this process within the next 45 to 60 days. Steve Stagner, Executive Chairman, President and CEO of Mattress Firm, said, "Mattress Firm is open for business and offering customers the best beds at the best prices every day, just as we always have. The Court's interim approvals of our First Day motions represent the successful first steps in the actions we are taking to strengthen our balance sheet and provide us the resources to improve our product offering, strategically expand into new and existing markets and ultimately, provide greater value to the customers we serve." Publicly traded peers include Tempur Sealy (TPX) and Sleep Number (SNBR).